Are your SMSF annual returns up-to-date and compliant? If they’re not, from 1 October your SMSF status on the Super Fund Lookup will change. Kathy Evans, Senior Partner - SMSF, discusses these regulatory changes and what’s involved to remain compliant.
For many years, the ATO has focussed on SMSF trustees lodging their annual tax returns on time. They are taking this approach to protect the retirement savings of SMSF members.
Over the last 12 months, the ATO has contacted approximately 50,000 SMSF trustees advising them of outstanding returns and the possible removal of their SMSF regulation details from the Super Fund Lookup (SFLU).
From 1 October 2019, if an SMSF has any annual return which is outstanding more than two weeks past the lodgement deadline and hasn’t requested a lodgement deferral, the ATO will change the fund’s status on the SFLU.
What is the Super Fund Lookup (SFLU)?
The SFLU is a publicly available internet-based tool used to determine the complying status of an SMSF. It will also show when an SMSF has had its ‘regulation details removed’ due to outstanding lodgements.
As a reminder, the annual lodgement deadline for SMSFs is generally one of the following:
• 15 May for the majority of SMSFs
• 28 February for new funds lodging their first returns
• 31 October for SMSFs with prior year annual returns overdue.
What does it mean to have ‘regulation details removed’?
During the period that an SMSF has their regulation status changed on the SFLU to ‘regulation details removed’, the following restrictions will apply:
• employers will not be able to make superannuation guarantee contributions; and
• APRA funds will be unable to process rollovers of member benefits to the SMSF.
The SMSF may also find it difficult to undertake investment transactions, such as share purchases and sales, during this time.
The ATO has warned that the next step will be ‘failure to lodge on time’ penalties.
The good news is that an SMSFs ‘complying’ status will be reinstated on the SFLU on the first business day of the month following when the SMSF lodges all overdue annual returns.
What’s the next step?
If your SMSF currently has outstanding annual returns, it is important you get in touch with a Findex SMSF Adviser as soon as possible. We can help with bringing everything up to date for your fund, and more importantly we can help to address any concerns you may have in this regard.